Franchise brands not required for hotel financing?
March 8, 2007
Does your lender say you need a franchise to guarantee cash flow? That’s old thinking now.
When your bank requires a franchise, give them the letter. It goes like this.
According to Smith Travel Research, US independent hotels consistently outperform chain hotels in rooms sold and average daily rate. Of the top 300 grossing US hotels, the top 25 are independents.
As an alternative to expensive hotel franchising, hotels can now be backed by Magnuson Hotels, the world’s largest independent hotel group. As the 17th largest overall hotel company in the world, Magnuson provides low-cost performance driven reservations, group purchasing and marketing support to over 600 hotels across the US and Canada.
Hotels backed by Magnuson’s size, stability, market presence and global reservation system will see higher net income from a lower cost operating structure. Eliminating franchise fees, one of the largest operating expenses for most hotels, will immediately increase bottom line performance, pleasing both lending institutions and owners.
Magnuson utilizes the many of the same GDS (global distribution systems) and reservation system backbones as does most top chains, but adds even more visibility with an expanded worldwide distribution through over 2000 internet booking channels, 650,000 global travel agents, and all top search engines. Because Magnuson does not have the costs associated with supporting a global brand or large corporate organizational structure, Magnuson can provide reservation delivery at a much lower cost.
Owners-need a letter to send to your bank?
About Magnuson Hotels, the fastest growing hotel chain in history.
In only seven years, Magnuson Hotels headquartered in Spokane, WA has become the world’s largest independent hotel group, representing nearly 1500 hotels and a combined affiliate base with assets in excess of $5.5 Billion. One of the top 10 global hotel chains, Magnuson Hotels was the #1 Hotel Company of Inc. Magazine’s 2009 annual ranking of the 5,000 fastest growing privately owned U.S. companies. With a four year reservation sales growth of 595%, Magnuson Hotels is listed in the top 100 U.S. business services companies.
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